Joint Ownership Can Override Your Will
Joint ownership can change who receives an asset when you die, sometimes regardless of what your will or trust says. In Massachusetts, the result depends on the type of property and the form of ownership. “Our names are both on it” is a starting point, but it does not tell us enough to explain the legal outcome. The deed or account agreement may be making an important estate planning decision that you have never discussed with the attorney who prepared your documents.
What Survivorship Means for a Bank Account
The distinction many people have in mind is survivorship. When property is held with an effective right of survivorship, the deceased owner’s interest generally passes to the surviving owner outside probate. With a bank account, the account agreement and applicable law determine the arrangement. Many joint accounts include survivorship rights, but you should confirm the terms rather than assume that every account with two names works identically. See the Consumer Financial Protection Bureau guidance on joint accounts after death.
Real Estate Has Its Own Categories
Real estate has its own ownership categories. Joint tenancy generally includes survivorship, while a tenancy in common generally leaves each owner with an interest that passes through that owner’s estate plan or applicable inheritance rules. Massachusetts actually starts from tenancy in common: a deed to two or more people creates a tenancy in common unless it expressly says they take as joint tenants, or to them and the survivor of them. See c.184 § 7. Married couples may hold Massachusetts property as tenants by the entirety, which also includes survivorship and has additional legal characteristics, including protection from a creditor of one spouse while the home is the other spouse’s principal residence. See c.209 § 1. Those phrases are doing real work in the deed. They are not interchangeable descriptions of the fact that two people own a house together.
When “Equal” in the Will Is Not Equal in Practice
Suppose your will divides your estate equally among three children, but a substantial account is jointly owned with one child and passes to that child by survivorship. The equal division in the will generally governs the assets passing under the will, not an account that passes separately. Whether a particular account creates an enforceable survivorship gift can require closer review, especially when someone was added only for convenience. The practical lesson is that “the will says equal” does not resolve every asset. The same problem shows up when parents add a child to the deed.
Joint Ownership Matters While Everyone Is Alive
Joint ownership also has consequences while everyone is alive. Depending on the account terms, another owner may have withdrawal rights that go well beyond helping pay bills. With real estate, another owner’s participation may be required for a sale or other transaction. Creditor issues and disagreements can also affect jointly owned property, with protections varying by ownership form and circumstances. If the purpose is simply to authorize help, it is worth asking whether an agency arrangement, such as a durable power of attorney, would accomplish that purpose more appropriately than ownership.
Married Couples and the Second Death
For married couples, survivorship can work smoothly at the first death while leaving unanswered questions about the second. The survivor may become the sole owner, but the property still needs a plan for what happens afterward. Joint ownership may also direct assets away from a trust intended to receive them at the first death. If the documents contemplate funding a bypass trust or preserving property for particular beneficiaries, the ownership arrangement needs to be consistent with those instructions.
Avoiding Probate Is Not Avoiding Estate Tax
Avoiding probate also does not necessarily remove an asset from the taxable estate. Jointly owned property can still be included for estate tax purposes, with the treatment depending on the ownership and applicable tax rules. This is why we separate the question “Who receives it?” from “How is it taxed?” A transfer can occur without a probate proceeding and still require careful tax review. Calling an asset “joint” does not answer both questions. See the Massachusetts Estate Tax Guide and our FAQ on Massachusetts estate taxes.
Review the Deeds and Account Registrations Together
We would review the actual deeds and account registrations alongside your will, trust, and beneficiary designations. That review often reveals choices made years ago for reasons that no longer apply, such as opening an account together because it was convenient at the time. Joint ownership can be useful when it serves a deliberate purpose. The concern is allowing an old ownership arrangement to decide who receives a major asset while your written estate plan is giving the family a different expectation.
Start with a free 15-minute consult call with Nicole Ott, our Lead Intake Coordinator. Tell her which accounts or property are in joint names and with whom. That is usually enough for us to say whether your plan and your ownership line up.
